Trade Records, Not Money, Are Keys To Trading Success
Without Good Metrics, A Trader Will FailTrading Records Are Critical For Day Trading Success
Day traders are going to want to shoot for two goals. The first, of course, is profitability. The second is consistency. Without consistency, day traders won’t be able to stay in the game and profitability is going to go out the window. So how do day traders become consistent? Day traders have to practice and have to keep score of their trading activities; and the way to keep score of trading activities is not to simply count the money because whether a trader makes money or loses money is a result of their trading metrics. Keeping score of your trade metrics is very important.
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If you fancy yourself a day trader, you should know what you’re doing. Do you practice paper trading? Yes? What are you practicing? (if you can’t answer that, watch this video, then click the button)
How to Calculate Trade Metrics
What do we mean when we talk about trade metrics? This spreadsheet gives an example of the metrics to keep track of in order to become a consistent trader. Two metrics that are particularly important to improve trading performance are represented in this spreadsheet by the number of winners per day and the percentage of winning trades. Traders should try to keep the percentage of winning trades around 70 percent. Another important metric is the cumulative average income or loss per trade over time.
Keeping these metrics takes a bit of arithmetic and a day trader needs to do it at the end of the trading session each day by entering this information. Over a period of time, traders who keep records of their trade metrics will know whether or not they’ll be able to be consistent or even be able to trade successfully.
Why Day Traders Should Know Their Metrics
Day traders are advised not to trade real money without being able to measure their metrics and keep them to a high enough level to know if they will become a consistent, successful trader.
This spreadsheet provides trade metric calculations automatically. Let’s say we make seven trades. Four are winners and we earn $300 for the day. The percentage of winners and the number of losers and the percentage of losers are calculated automatically. I then enter the losses for the day on the losing trades. We lost $125. The spreadsheet automatically calculates the other metrics.
Day Trading Metrics Show If A Trader Is Consist
The metrics will tell whether or not this trader can become a consistent trader. Keeping these records will help improve trade metrics for any day trader. The most important metrics are the percentage of winning trades and the cumulative average per trade. Why cumulative? Because over time anyone can make money on one or two days but over time is the key. If a day trader doesn’t have good metrics, he or she is not going to be a successful trader. Instead, they are not going to make money – they will lose money. Every day trader is urged to keep these trade record metrics.
Automated Day Trading Record-Keeping
I created an automated spreadsheet that facilitates trade record keeping without having to do the math. All that’s required is to enter the number of trades for the day, the number of winners, the profit, and any losses. Everything else is calculated automatically.
This spreadsheet is totally automated and will make trade record keeping very easy for keeping track of trading metrics. Trade metrics will be extremely helpful for becoming a better, more consistent trader. The spreadsheet is available for download for only ten dollars and will save day traders time and make trade record keeping very easy and without having to do the arithmetic. Download the automated trade record-keeping spreadsheet from a navbar link at timelessdollar.com or use the link on this page.
How To Know If You Can Trade Successfully?
Although day trading can be a risky endeavor, there are steps you can take to minimize your risks and set yourself up for success. One way to know if you will be profitable – or lose money – is to keep records of your trades. With the right tools and resources, you can become a successful day trader. Know your metrics. Download your automated trade record-keeping spreadsheet.
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